Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5059077 | Economics Letters | 2014 | 4 Pages |
Abstract
â¢Central bank faces uncertainty about potential output.â¢Min-max approach to policy.â¢A conservative central banker is beneficial if uncertainty increases.
Central banks face uncertainty about potential output. We model optimal monetary policy under discretion in a situation in which the central bank adopts a min-max approach to policy. The case for appointing a conservative central banker who puts a larger weight on inflation stabilization becomes stronger as the central bank's concern about misspecifications increases.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Peter Tillmann,